Steve Hamilton is a Tampa native and a graduate of the University of South Florida and the University of Missouri. He now lives in northern Kentucky. A career CPA, Steve has extensive experience involving all aspects of tax practice, including sophisticated income tax planning and handling of tax controversy matters for closely-held businesses and high-income individuals.

Friday, August 7, 2015

TomatoCare And The Supreme Court

Let’s play
make believe.

Late on a
dark and stormy Saturday night, the Congressional Spartans - urged on by Poppa John's
and the National Tomato Growers Association – passed a sweeping vegetable care
bill by a vote of 220-215.

The bill
went to the Senate, where its fate was sadly in doubt. The fearless majority
leader Harry Leonidas negotiated agreements with several recalcitrant senators,
including the slabjacking of New Orleans, an ongoing automatic bid for the
Nebraska Cornhuskers to the college Bowl Championship Series and the relocation
of Vermont to somewhere between North Carolina and Florida. After passage, the
bill was signed by the president while on the back nine at Porcupine Creek in Rancho
Mirage, California.

As a
consequence of this visionary act, Americans now had access to affordable
tomatoes, thanks to market reforms and consumer protections put into place by
this law. The law had also begun to curb rising tomato prices across the system
by cracking down on waste and fraud and creating powerful incentives for
grocery chains to spend their resources more wisely. Americans were now
protected from some of the worst industry abuses like out-of-season shortages
that could cut off tomato supply when people needed them the most.

California, Vermont
and Massachusetts established state exchanges to provide tomato subsidies to individuals
whose household income levels were below the threshold triggering the maximum federal individual income tax rate (presently 39.6 percent).
The remaining states had refused to establish their own exchanges, prompting the
federal government to intervene. The Tax Exempt Organization Division at the
IRS, recognized for their expertise in technology integration, data development
and retention, was tasked to oversee the installation of federal exchanges in those backwater baronies. IRS Commissioner Koskinen stated
that this would require a reallocation of existing budgetary funding and – as a
consequence - the IRS would not be collecting taxes from anyone in the Central
time zone during the forthcoming year.

The 54
states that did not establish their own exchanges filed a lawsuit (Bling v Ne’er-Do-Well) challenging a key
part of the TomatoCare law, which read as follows:

The premium assistance amount determined under this
subsection with respect to any vegetable
coverage amount is the amount equal to the lesser of the greater…”

These benighted
states pointed out that, botanically, a tomato was a fruit. A fruit was defined
as a seed-bearing vessel developed from the ovary of a flowering plant. A
vegetable, on the other hand, was any other part of the plant. By this standard,
seedy growth such as bananas, apples and, yes, tomatoes, were all fruits.

There was great
fear upon the land when the Supreme Court decided to hear the case.

Depending
upon how the Supreme Court decided, there might be no tomato subsidies because
tomatoes were not vegetables, a result clearly, unambiguously and irretrievably-beyond-dispute
not the intent of Congress on that dark, hot, stormy, wintery Saturday
night as they debated the merits of quitclaiming California to Mexico.

The case
began under great susurration. The plaintiffs (the 54 moon landings) read into evidence
definitions of the words “fruit” and “vegetables” from Webster’s Dictionary,
Worcester’s Dictionary, the Imperial Dictionary and Snoop Dogg’s album “Paid
tha Cost to Be da Bo$$.”

The Court acknowledged
that the words “fruit” and “vegetable” were indeed words in the English
language. As such, the Court was bound to take judicial notice, as it did in
regard to all words in its own tongue, especially “oocephalus” and “bumfuzzle.”
The Court agreed that a dictionary could be admitted in Court only as an aid to
the memory and understanding of the Court and not as evidence of the meaning of
words.

The Court went
on:

Botanically speaking, tomatoes are the fruit of the vine. But
in the common language of the 202 area code, all these are vegetables which are
grown in kitchen gardens and, whether eaten cooked, steamed, boiled, roasted or
raw, are like potatoes, carrots, turnips and cauliflower, usually served at
dinner with, or after, the soup, fish, fowl or beef which constitutes the principal
part of the repast.”

The Court decided:

But it is not served, like fruits
generally, as a dessert.”

With that,
the Court decided that tomatoes were vegetables and not fruit. The challenge to
TomatoCare was courageously halted, and the liberal wing of the Court – in a show
of their fierce independence and tenacity of intellect – posed for a selfie and
went to Georgetown to get matching tattoos.

Thus ends our
make believe.

There was no
TomatoCare law, of course, but there WAS an actual Supreme Court decision
concerning tomatoes. Oh, you didn’t know?

Back in the
1880s the Port of New York was taxing tomatoes as vegetables. The Nix family,
which imported tons of tomatoes, sued. They thought they had the law – and common
sense – on their side. After all, science said that tomatoes were fruit. The
only party who disagreed was the Collector of the Port of New York, hardly an
objective juror.

The tax law
in question was The Tariff of 1883, a historical curiosity now long gone, and
the case was Nix v Hedden.

About Me

Thirty years years in tax practice. It's a long time, and I have seen virtually everything short of the fabled tax-exempt unicorn. I was raised in Tampa, went to school in Missouri, taught at Eastern Kentucky University, lived in Georgia, got pulled to Cincinnati when I married, have in-laws in England and a daughter going to the University of Tennessee. I am not sure where I will wind up next, but I hope there is better weather.